Circle-K downsizes retail footprint as business model forced to adapt during pandemic
US convenience store Circle K has vacated several stores around Phnom Penh as the COVID pandemic forces the company towards a virtual delivery business model. Multiple stores operated by the master franchisee TH Group have now been stripped and are now on the market for lease.
Cambodia Investment Review was told by Century21 – the realtor for the now gutted Circle K store located along Phnom Penh’s riverside – that the 6m x 13m store is being offered at $4,000 a month. Circle K Cambodia is now utilizing its brand recognition to promote its products via its social media channels and offering delivery through popular app Nahm24 to its customers.
Steven Yos, Director of Circle K Cambodia told Cambodia Investment Review via email, that the business is not franchising at this point but is still operating as usual. Adding, it is challenging in the time of COVID.
Joe Levee Franchise Websites Manager Circle K Worldwide Franchise told Cambodia Investment Review that unfortunately, with the Delta Variant it is entirely possible that more people are working from home, and store sales are down, which may have led to layoffs in the company.
The first Circle K store in Cambodia was launched in 2018 with much fanfare by the US Ambassador at the time William A. Heidt who said the entrance of Circle K into the local economy is an important event for US-Cambodia relations.
“Today, Cambodia has convenience stores, modern supermarkets, even organic markets. The country’s economy is strong and attracts more investment, even from some of the world’s leading brands, including Circle K,” Heidt added.
In 2019, the company had approximately 40 stores located across Cambodia. Norm Tong, President of TH Group said at the time that in the next decade, the company plans to open 300 stores nationwide with a total investment of $20 million. It is unknown how the COVID pandemic has impacted the company’s long-term plans. SOURCE:CAMBODIA INVESTMENT REVIEW